THE MEDIA BUSINESS: ADVERTISING

THE MEDIA BUSINESS: ADVERTISING ; 5 agencies will vie for Levi's jeans account in one of the most closely watched reviews of the year.

By Stuart Elliott

Published: November 25, 1997

FIVE agencies were selected yesterday by Levi Strauss & Company to contend for its estimated $90 million domestic jeans account in one of the most closely watched reviews of the year.

The finalists in the review for what is formally known as the Levi's brand U.S.A. assignment include the incumbent shop of 67 years, the San Francisco office of Foote, Cone & Belding, and Bartle Bogle Hegarty, a hot creative agency based in London that works for Levi Strauss in Europe and Asia.

The other three finalists are also known for their creative prowess. They are Hal Riney & Partners in San Francisco and two units of the Omnicom Group, BBDO Worldwide in Los Angeles and New York and TBWA Chiat/Day in Venice, Calif. A decision -- which may involve dividing assignments between agencies -- is expected in February.

''It's a formidable list, as we knew it would be,'' said Geoff Thompson, executive vice president and worldwide creative director at Foote, Cone, who is directing the extensive efforts to hold the account.

In a year of continual advertising upheavals -- including a review announced yesterday by a Levi Strauss competitor, Tommy Hilfiger USA -- the Levi's review has become emblematic of the remaking of Madison Avenue as marketers reassess needs in the face of intensified competition. Indeed, the jeans review has come to dominate the advertising agenda to the degree that a recent article in the trade publication Adweek carried a headline referring to ''That Account.''

Executives of Foote, Cone, a unit of True North Communications, were stunned when Levi Strauss unexpectedly announced the jeans review on Oct. 20. The agency's campaigns for Levi's denims, which have carried themes like ''501 blues'' and ''Jeans for women,'' are considered among the most effective and creative in advertising history. But strains in the agency-client relationship had begun to appear amid personnel changes at Foote, Cone and Levi Strauss since 1995.

Initially, Levi Strauss executives described the reasons for the review only generally, as part of plans ''to proactively build the Levi's brand.'' The mystery was clarified two weeks later, when Levi Strauss made a second, equally startling announcement: It would close 11 plants in four states and lay off a third of its North American work force because of declining sales, particularly among younger consumers.

Levi Strauss is being squeezed on the high end by designer-brand jeans like Hilfiger, Calvin Klein, Diesel and Versace and on the low end by store brands like Gap, Arizona (J. C. Penney) and Canyon River Blues (Sears, Roebuck). And several small brands like JNCO and Kik Wear have proved more adept at introducing the extreme styles now favored by teen-agers like baggy, wide-legged jeans.

''It's the same problem we have gone through a number of times in the past,'' Mr. Thompson said. ''Teen-agers don't automatically want to adopt a 150-year-old brand.''

''We've always managed to find a way'' to accomplish that task, he added. ''And that's what we're trying to do now.''

Foote, Cone, which continues handling the Dockers and Slates brands of casual and dress pants for Levi Strauss, is striving mightily to hold the jeans account. For instance, Mr. Thompson, who once worked for Foote, Cone in San Francisco, had been scheduled to relocate from the agency's headquarters in Chicago to London, where he would focus on international assignments. But now he has returned to San Francisco for the duration of the review.

Levi Strauss, for its part, is increasing its marketing budget and revamping product plans. A new line of jeans aimed at mainstream consumers, Special Reserve, has been canceled as a line for younger shoppers, Red Line, is made ready for a fall 1998 introduction.

As for the advertising, ''we think these five agencies have the most to offer us in terms of strategic and creative thinking,'' said Brad Williams, marketing manager for Levi Strauss U.S.A. ''It's a pretty well- rounded list.''

Mr. Williams declined to discuss whether other agencies had been considered for the review; trade publications identified one potential contender as the DDB Needham Worldwide unit of Omnicom, which reopened its San Francisco office last year.

One finalist, Bartle Bogle, works for Levi Strauss in Britain, Europe and nine Asia-Pacific markets. Only eight months ago, the agency was awarded additional duties in countries including Australia, India and South Korea. Bartle Bogle commercials for Levi's jeans have appeared in America as part of a Foote, Cone campaign.

Winning the domestic jeans account would provide Bartle Bogle with a foundation for a long anticipated entry into the American market, just as landing the Adidas A. G. account did for a rival British agency, Leagas Delaney, which now has a San Francisco office.

Turning to the other finalists, Riney is best known for campaigns for the Saturn and EV1 electric automobiles from the General Motors Corporation; other clients include the First Union Corporation and Skyy vodka.

As for the Hilfiger review, that company is reassessing its worldwide account with billings estimated at $30 million, which has been handled for six years by Toth Design and Advertising in New York.

Peter Connolly, senior vice president for global marketing at Hilfiger in New York, confirmed a report of the review this week in Adweek. Toth has been invited to compete, he said, along with agencies he declined to identify. Adweek listed three New York shops as possible participants: Cliff Freeman & Partners, a unit of Cordiant P.L.C.; DDB Needham New York, part of Omnicom, and Deutsch Inc.